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>When in a war, you are buying ammunition and weaponry with USD, not PPP. Not if you're buying it locally. >When there's a energy shock, you are importing oil

>When in a war, you are buying ammunition and weaponry with USD, not PPP. Not if you're buying it locally. >When there's a energy shock, you are importing oil and gas with USD, not PPP. When you are in a AI race, you are buying GPUs with USD, not PPP. Pretty much. PPP is useful for the stuff you can source locally like groceries, rents, local cars and groceries, etc. but a lot of stuff needs to be imported so then the EU's financially weaker position shows, especially when bidding internationally for scarce items.

spywaregorilla 3y ago
Not if you're buying it locally from an entirely domestic supply chain which is approximately nothing
- dukeyukey 3y ago
  You'd be surprised, Europe has a massive industrial base. European steel can be made with European iron and coal to make European weapons in European factories from European designs.
  - spywaregorilla 3y ago
    Sourced with european energy produced by european produced infrastructure and by workers eating european food grown with european resources? It's "possible" for this to happen. And in the event of a large global war, we'll even go as far as to say it's plausible. But given that the world is heavily globalized and not at war, it's not actually what happens because it is cheaper to trade with others.
    - dukeyukey 3y ago
      We're talking about this in the context of PPP versus nominal GDP when buying military equipment. Most countries _have_ to buy at nominal prices cos they either don't have a domestic arms industry, or they have one, which uses resources bought at nominal, global prices. But the EU has both a domestic arms industry _and_ the inputs locally, so it's probably cheaper to go the domestic route, hence they can buy at PPP rates rather than nominal.
      - spywaregorilla 3y ago
        I'm not an expert in arms production but I find it extremely unlikely that the eu arms industry is not heavily globalized

spywaregorilla 3y ago

Not if you're buying it locally from an entirely domestic supply chain which is approximately nothing

dukeyukey 3y ago
You'd be surprised, Europe has a massive industrial base. European steel can be made with European iron and coal to make European weapons in European factories from European designs.
- spywaregorilla 3y ago
  Sourced with european energy produced by european produced infrastructure and by workers eating european food grown with european resources? It's "possible" for this to happen. And in the event of a large global war, we'll even go as far as to say it's plausible. But given that the world is heavily globalized and not at war, it's not actually what happens because it is cheaper to trade with others.
  - dukeyukey 3y ago
    We're talking about this in the context of PPP versus nominal GDP when buying military equipment. Most countries _have_ to buy at nominal prices cos they either don't have a domestic arms industry, or they have one, which uses resources bought at nominal, global prices. But the EU has both a domestic arms industry _and_ the inputs locally, so it's probably cheaper to go the domestic route, hence they can buy at PPP rates rather than nominal.
    - spywaregorilla 3y ago
      I'm not an expert in arms production but I find it extremely unlikely that the eu arms industry is not heavily globalized